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Jollibee Food
  Corporation
By
Rohit Sharma
Jollibee’s Introduction
 In1975 Tony Tan and his brothers opened two
 Ice cream parlors in Manila, Philippines

 Inthe same year they expanded their menu
 and began offering quick meals

 Soon they realized that their revenue is more
 from the side orders

 In 1978, Jollibee Food Corporation(JFC) is
 formed
JFC’s in Philippines
 High   quality and reasonably priced

 Tailored   menu specifically for Filipino's

 Strong understanding of Filipino’s taste and
 preference

 Highly   diverse variety of offerings

 Benchmarking     of McDonalds
Milestones in Journey of JFC
       • First Philippine Food chain to cross
1989     “1 Billion Peso” mark


       • JFC went to Public on Philippine Stock
1993     Exchange



       • Purchased Greenwich Pizza
1994
• Acquired right to operate Philippine’s
         Franchise of Delifrance
1995



       • Bought Chowking Foods Corporation
2000



       • JFC topped the “Asia’s Most Admired
         Company” survey
2004
Trends in number of stores by
            brand
             2005   2004   2003   2002   2001   2000   1999   1998

 Jollibee    508    499    467    436    408    374    350    302

Greenwich    228    232    213    191    194    193    191    169

Chowking     310    303    245    216    194    164    159    142

Delifrance    33     31     30     28     24     13     6      4

  Total      1079   1065   955    871    832    744    712    617
Financial Data of JFC, 1998-2004

             2004     2003     2002      2001   2000   1999   1998


  Sales      35.5     28.9      26,8     24.1   20.3   18.1   16.7


  Gross      26.2     21.6      20.3     18.8   15.7   14.1   12.9
 Revenue

Net Income    1.6      1.3       1.0     0.5    0.9    0.6    0.8


Employees    26.5     21.6      22.0     21.8   20.6   14.2   13.9
  (‘000)



All financial data in billion of pesos
Secrets of Success of JFC in Terms
 of Marketing, Operations and HR

The acronym FSC represented its commitment
towards these three areas:

Every Food (F) item served to the public must
meet the company’s excellent standards or it will
not be served at all, Service (S) must be fast and
courteous; and Cleanliness (C) from sidewalk to
kitchen, from uniforms to utensils, must be
maintained at all times.
Marketing Strategies
 Closer   to Filipino families

 Unique     Filipino taste

 Homely     environment

 In-store   play activities

 Advertising strategy that was deeply rooted in
 traditional values
Operations

 Use   of IT in its
    operations

   Decentralizing the
    organization

   Each year some stores
    are closed
Human Resource Management
   Hire right candidates to manage its operations
    and strategy planning

   Training programs for the employees to explain
    them- How to create a friendly environment in
    store?
Strategy Of Adding New Brands Or
Diluting The Strength Of Original Brand

                                JOLLIBEE
 GREENWICH
PIZZA(1994)
                               GREENWICH
                                 PIZZA
DELIFRANCE
  (1995)
                               DELIFRANCE
                JOLLIBEE
DELIFRANCE
  (1995)
                               DELIFRANCE
2004              2000

            NO.OF       %INCREASE NO.OF
            STORES                STORES



JOLLIBEE    478         27.8%     374


GREENWIC    226         17.1%     193
H

CHOWKIN     276         68.3%     164
G

DELIFRANC   28          115.6%    13
E
Each brand is marketed independently but there must not be any
duplication of original Jollibee concept.


MAIN RISK : Management time would be diverted to the other three
brands and there would be insufficient time to expand Jollibee.
Evaluate JFC’s performance
               overseas.
 Early1990s Jollibee restaurants were operating
 in Hong Kong, Brunei, Saipan, and Guam,
 Vietnam, Indonesia, Dubai, and Kuwait

 1998   entered one of the most demanding fast-
 food markets in the world, the United States. (2
 million Filipino immigrants).

In the United States, by late 2004, six years after its
entry into this market, JFC only had seventeen
stores—nine Jollibee and eight Chow King.
 Marketing effectiveness has been diluted in
 the very competitive California environment
 by the need to promote three separate
 brands, each representing a different ethnic
 food category: Filipino, Chinese, and
 Japanese.

 Management   time and resources have been
 wasted on the purchase of a Japanese food
 franchise (renamed Tomi’s Teriyaki), a food
 category in which JFC had no prior
 experience
Evaluate JFC’s performance
         overseas.

At the end of 2003, prior to the purchase of
Yonghe King in 2004, JFC had only thirty-
three overseas stores, an increase of only
six from the twenty-seven it had at the end
of 1999.
To what extent can the company
transfer its core competency to its
       overseas operations?
JFC’s key success factors in the
Philippines
                         (1)its understanding of local tastes
                        and skills in catering to the needs of
                                a specific niche market,



                        (2) its operational efficiency in its
                           commissaries and use of IT,



                        (3) its ability to deliver consistently
                          high levels of customer service


                             (4)its skills in site selection.




 large number of stores in the Philippines  advantage of
economies of scale in buying food and other supplies  managing the
logistics of delivering supplies to individual stores
Jollibee’s key           Transferability to    Actions required to
success factors          overseas markets      allow a successful
(KSF)                                          transfer of KSF


Niche Market             Likely                Introduce the more
Highly localized menu.   - Overseas markets    popular Jollibee meals
Food variety that        that are chosen are   that are found in the
                                               Philippines.
targets the Filipino     locations with high
palate.                  concentrations of     - Slowly bring in the
                         Filipinos.            other varieties.

                                               -Ingredients used must
                                               be identical to those used
                                               in the Philippines to
                                               ensure consistent quality
                                               and taste.

                                               - Use a marketing
                                               strategy that leverages on
                                               Jollibee’s brand equity.
Jollibee’s key        Transferability to       Actions required to
success factors (KSF) overseas markets         allow a successful
                                               transfer of KSF




Operations and IT       Likely                 Use the blueprint of
                                               the commissary in the
State-of-the-art        - Replicate the same   Philippines.
automation of           kind of technology and
commissary.             operating efficiency.  - High initial
                                               investment to bring in
Use of IT to speed up                          state-of-the-art
operations efficiency                          automation that will
and study consumer                             help generate the
trends.                                        volume and efficiency
                                               required by the
                                               overseas branch.
Jollibee’s key success Transferability to              Actions required to
factors (KSF)          overseas markets                allow a successful
                                                       transfer of KSF


Customer Service                   Likely              -Jollibee should seek to
                                                       understand the
Fantastic customer        The mission statement        expectations of local
service:                  and strong management        customers and adapt its
                          beliefs in recognizing the   performance standards,
                          importance of its front      and so on accordingly.
- Service orientation
                          line staff in profit
pervasive in many of      generation.                  - Jollibee should bring in
its activities.                                        the best crew from its
                                                       Philippines’s branches to
- Recruitment,                                         train the local hires in
selection, and training                                Jollibee technology.
(cycle for success) of
                                                       - Important that Jollibee
staff.
                                                       has a management team
                                                       in the overseas market
- Empowerment and                                      that shares the same zeal
motivation of staff.                                   and ideals as those in the
                                                       Philippines headquarters.
Jollibee’s key        Transferability to            Actions required to
success factors (KSF) overseas markets              allow a successful
                                                    transfer of KSF




Location                 Moderate                   Jollibee should
Good, high traffic and                              continue to expand to
convenient locations.    -Jollibee may be a late    areas with high
                         comer in the fast-food     Filipino concentration
Communities are          industry of the            and gain a foothold in
populated largely with   overseas market.           such areas first.
Filipinos.
                         - Launch pad strategy
                         of setting up outlets in
                         places with high
                         Filipino concentration
                         may help offset the
                         late comer
                         disadvantage.
One possible conclusion that may be drawn
  from JFC’s international experience::

 Only  limited demand overseas for the Filipino-
  style fast food served by Jollibee.
 JFC’s entry (or rather, re-entry) into China
  through purchase of an 85 percent interest in the
  Shanghai-based Yonghe King chain, which serves
  Chinese-style fast food in ten cities, plays to JFC’s
  capabilities in taking over ownership and
  management of an already successful fast-food
  chain and strengthening its marketing and
  operational capabilities.
Expansion Plans
 Continue to be on the Philippines market.
 Focus on China.
 Overseas markets.
Continue to be on the
           Philippines market
 89% of all stores are
 located in Philippines.

 Rapidgrowth is
 continuing.

 Most of this growth
 seems to be accounted
 for by franchised
 outlets as opposed to
 company-owned ones.
Focus on China
      The second most important area of
       focus is China

      Manage the growth of the eighty-nine-
       store of Yonghe King chain.

      Transfer relevant JFC operational and
       marketing expertise to enhance both
       YK’s appeal to consumers and its
       productivity

      China’s rapid economic development

      Success of both the KFC and
       McDonald’s
THANK
 YOU

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Jollibee's International Expansion Strategy

  • 1. Jollibee Food Corporation By Rohit Sharma
  • 2. Jollibee’s Introduction  In1975 Tony Tan and his brothers opened two Ice cream parlors in Manila, Philippines  Inthe same year they expanded their menu and began offering quick meals  Soon they realized that their revenue is more from the side orders  In 1978, Jollibee Food Corporation(JFC) is formed
  • 3. JFC’s in Philippines  High quality and reasonably priced  Tailored menu specifically for Filipino's  Strong understanding of Filipino’s taste and preference  Highly diverse variety of offerings  Benchmarking of McDonalds
  • 4. Milestones in Journey of JFC • First Philippine Food chain to cross 1989 “1 Billion Peso” mark • JFC went to Public on Philippine Stock 1993 Exchange • Purchased Greenwich Pizza 1994
  • 5. • Acquired right to operate Philippine’s Franchise of Delifrance 1995 • Bought Chowking Foods Corporation 2000 • JFC topped the “Asia’s Most Admired Company” survey 2004
  • 6. Trends in number of stores by brand 2005 2004 2003 2002 2001 2000 1999 1998 Jollibee 508 499 467 436 408 374 350 302 Greenwich 228 232 213 191 194 193 191 169 Chowking 310 303 245 216 194 164 159 142 Delifrance 33 31 30 28 24 13 6 4 Total 1079 1065 955 871 832 744 712 617
  • 7. Financial Data of JFC, 1998-2004 2004 2003 2002 2001 2000 1999 1998 Sales 35.5 28.9 26,8 24.1 20.3 18.1 16.7 Gross 26.2 21.6 20.3 18.8 15.7 14.1 12.9 Revenue Net Income 1.6 1.3 1.0 0.5 0.9 0.6 0.8 Employees 26.5 21.6 22.0 21.8 20.6 14.2 13.9 (‘000) All financial data in billion of pesos
  • 8. Secrets of Success of JFC in Terms of Marketing, Operations and HR The acronym FSC represented its commitment towards these three areas: Every Food (F) item served to the public must meet the company’s excellent standards or it will not be served at all, Service (S) must be fast and courteous; and Cleanliness (C) from sidewalk to kitchen, from uniforms to utensils, must be maintained at all times.
  • 9. Marketing Strategies  Closer to Filipino families  Unique Filipino taste  Homely environment  In-store play activities  Advertising strategy that was deeply rooted in traditional values
  • 10. Operations  Use of IT in its operations  Decentralizing the organization  Each year some stores are closed
  • 11. Human Resource Management  Hire right candidates to manage its operations and strategy planning  Training programs for the employees to explain them- How to create a friendly environment in store?
  • 12. Strategy Of Adding New Brands Or Diluting The Strength Of Original Brand JOLLIBEE GREENWICH PIZZA(1994) GREENWICH PIZZA DELIFRANCE (1995) DELIFRANCE JOLLIBEE DELIFRANCE (1995) DELIFRANCE
  • 13. 2004 2000 NO.OF %INCREASE NO.OF STORES STORES JOLLIBEE 478 27.8% 374 GREENWIC 226 17.1% 193 H CHOWKIN 276 68.3% 164 G DELIFRANC 28 115.6% 13 E
  • 14. Each brand is marketed independently but there must not be any duplication of original Jollibee concept. MAIN RISK : Management time would be diverted to the other three brands and there would be insufficient time to expand Jollibee.
  • 15. Evaluate JFC’s performance overseas.  Early1990s Jollibee restaurants were operating in Hong Kong, Brunei, Saipan, and Guam, Vietnam, Indonesia, Dubai, and Kuwait  1998 entered one of the most demanding fast- food markets in the world, the United States. (2 million Filipino immigrants). In the United States, by late 2004, six years after its entry into this market, JFC only had seventeen stores—nine Jollibee and eight Chow King.
  • 16.  Marketing effectiveness has been diluted in the very competitive California environment by the need to promote three separate brands, each representing a different ethnic food category: Filipino, Chinese, and Japanese.  Management time and resources have been wasted on the purchase of a Japanese food franchise (renamed Tomi’s Teriyaki), a food category in which JFC had no prior experience
  • 17. Evaluate JFC’s performance overseas. At the end of 2003, prior to the purchase of Yonghe King in 2004, JFC had only thirty- three overseas stores, an increase of only six from the twenty-seven it had at the end of 1999.
  • 18. To what extent can the company transfer its core competency to its overseas operations?
  • 19. JFC’s key success factors in the Philippines (1)its understanding of local tastes and skills in catering to the needs of a specific niche market, (2) its operational efficiency in its commissaries and use of IT, (3) its ability to deliver consistently high levels of customer service (4)its skills in site selection. large number of stores in the Philippines  advantage of economies of scale in buying food and other supplies  managing the logistics of delivering supplies to individual stores
  • 20. Jollibee’s key Transferability to Actions required to success factors overseas markets allow a successful (KSF) transfer of KSF Niche Market Likely Introduce the more Highly localized menu. - Overseas markets popular Jollibee meals Food variety that that are chosen are that are found in the Philippines. targets the Filipino locations with high palate. concentrations of - Slowly bring in the Filipinos. other varieties. -Ingredients used must be identical to those used in the Philippines to ensure consistent quality and taste. - Use a marketing strategy that leverages on Jollibee’s brand equity.
  • 21. Jollibee’s key Transferability to Actions required to success factors (KSF) overseas markets allow a successful transfer of KSF Operations and IT Likely Use the blueprint of the commissary in the State-of-the-art - Replicate the same Philippines. automation of kind of technology and commissary. operating efficiency. - High initial investment to bring in Use of IT to speed up state-of-the-art operations efficiency automation that will and study consumer help generate the trends. volume and efficiency required by the overseas branch.
  • 22. Jollibee’s key success Transferability to Actions required to factors (KSF) overseas markets allow a successful transfer of KSF Customer Service Likely -Jollibee should seek to understand the Fantastic customer The mission statement expectations of local service: and strong management customers and adapt its beliefs in recognizing the performance standards, importance of its front and so on accordingly. - Service orientation line staff in profit pervasive in many of generation. - Jollibee should bring in its activities. the best crew from its Philippines’s branches to - Recruitment, train the local hires in selection, and training Jollibee technology. (cycle for success) of - Important that Jollibee staff. has a management team in the overseas market - Empowerment and that shares the same zeal motivation of staff. and ideals as those in the Philippines headquarters.
  • 23. Jollibee’s key Transferability to Actions required to success factors (KSF) overseas markets allow a successful transfer of KSF Location Moderate Jollibee should Good, high traffic and continue to expand to convenient locations. -Jollibee may be a late areas with high comer in the fast-food Filipino concentration Communities are industry of the and gain a foothold in populated largely with overseas market. such areas first. Filipinos. - Launch pad strategy of setting up outlets in places with high Filipino concentration may help offset the late comer disadvantage.
  • 24. One possible conclusion that may be drawn from JFC’s international experience::  Only limited demand overseas for the Filipino- style fast food served by Jollibee.  JFC’s entry (or rather, re-entry) into China through purchase of an 85 percent interest in the Shanghai-based Yonghe King chain, which serves Chinese-style fast food in ten cities, plays to JFC’s capabilities in taking over ownership and management of an already successful fast-food chain and strengthening its marketing and operational capabilities.
  • 25. Expansion Plans  Continue to be on the Philippines market.  Focus on China.  Overseas markets.
  • 26. Continue to be on the Philippines market  89% of all stores are located in Philippines.  Rapidgrowth is continuing.  Most of this growth seems to be accounted for by franchised outlets as opposed to company-owned ones.
  • 27. Focus on China  The second most important area of focus is China  Manage the growth of the eighty-nine- store of Yonghe King chain.  Transfer relevant JFC operational and marketing expertise to enhance both YK’s appeal to consumers and its productivity  China’s rapid economic development  Success of both the KFC and McDonald’s